The European Securities and Markets Authority (ESMA) has served trade repository (TR) REGIS-TR a €1,374,000 fine for “serious breaches of organisational obligations.”
The issue concerned incorrect implementation of the new Securities Financing Transactions Regulation (SFTR) reporting regime and “compromised the confidentiality of TR data”, according to the regulator.
The sanction, which reflects seven infringements under the European Market Infrastructure Regulation (EMIR) and SFTR, marks the highest fine imposed by ESMA on a trade repository to date.
In addition, the fine is also the first enforcement case to concern SFTR breaches, and ESMA has issued a public notice, which will require all ongoing REGIS-TR infringements to terminate.
Verena Ross, ESMA’s chair, said: “REGIS-TR failed to comply with its obligations under EMIR and SFTR. Data on trades made available to public authorities is essential for market surveillance, enabling early detection of exposure concentrations, cross-border risks, and changes in liquidity and leverage.
“Our decision highlights ESMA’s commitment to enforcing essential requirements that ensure transparency and contribute to well-functioning markets.”
Under EMIR and SFTR, TRs are expected to comply with obligations to maintain their data quality and protect EU market stability and integrity, with REGIS-TR’s breaches related to EMIR and SFTR policies and procedures, organisational structure and operational risk, as well as confidentiality and misuse of information.
Specifically, the seven infringements span deficiencies in REGIS-TR’s policies and procedures, impacting the clarity of governing bodies’ responsibilities, shortcomings in the firm’s organisational structure, failure to identify and minimise sources of operational risk, an inability to ensure the confidentiality, integrity and protection of information received under EMIR, and failure to prevent misuse of information received.
Ross added: “This case stems from long-lasting serious overarching issues identified at REGIS-TR. We will continue to foster a strong compliance culture, including by taking enforcement action, when appropriate.”
The regulator also confirmed that it required REGIS-TR to bring three unremedied infringements to an end, and that it had considered aggravating and mitigating factors in EMIR when calculating the fine.